MacRumors.com

Readers report that CNBC has mentioned a report by Nikkei Net Interactive that Apple and Softbank are developing an iPod/Cell Phone:

Softbank Corp. and Apple Computer Inc. plan to jointly develop cellular phone handsets that have built-in iPod digital music players and can download songs directly from Apple's iTunes Music Store, The Nihon Keizai Shimbun learned Friday

The entire article is restricted to subscribers only, so further details not presently available. There have been a number of ongoing rumors that Apple has been working on a cellphone. In addition published patent applications have revealed that Apple has indeed been working on technology to allow users to purchase iTunes songs over cell phones.

The exact timeframe for the Apple-branded phone has been vague. Initial speculative reports claimed that an Apple Phone is expected in the next 12 months.

Cell phones with iTunes-playing capability are not entirely new. Motorola introduced the first iTunes-capable cell phone in September 2005 with a followup model (SLVR) in January. These models though were met with some criticism, especially due to the 100-song cap imposed on song storage.

Update: Appleinsider offers some more details of the report. The report indicates that it will be a 3G cell phone combining features of the iPod and Cell phone and is expected to be released in Japan "sometime this year at the earliest" and in the U.S. at a later date.

Update 2: Quotes/Details from the article:

Softbank President Masayoshi Son and Apple Chief Executive Officer Steve Jobs met and reached a basic agreement on this partnership in cell phone handset operations.

It appears, Apple will sell this phone under the "Apple" brand:

Apple, which will be selling cell phone handsets under its own brand for the first time, is expected to outsource production. The company is believed to have chosen Softbank as its partner because Softbank plans to offer high-speed Internet access for cell phones, with a focus on improving convenience for consumers.

Update 3: Softbank has released a statement claiming that media reports are "speculation."